DEBT (Tables)

12 Months Ended

Aug. 31, 2012

Debt Disclosure [Abstract]

Schedule of short-term borrowings

Short-term borrowings consist of lines of credit which are secured by certain assets of the Company and its subsidiaries and in some cases are guaranteed by the Company as summarized below (in thousands):

			Facilities Used
	Total Amount of Facilities		Short-term Borrowings		Letters of Credit		Facilities Available		Weighted average interest rate of loans outstanding
August 31, 2012	$	36,967	$	—	$	774	$	36,193	N/A
August 31, 2011	$	28,033	$	2,259	$	453	$	25,321	9.5	%

Schedule of long-term debt

Long-term debt consists of the following (in thousands):

	August 31, 2012		August 31, 2011
Note due July 2017, 9.0% fixed rate(5)(12)	$	—	$	5,147
Note due January 2022, 8.0% current rate (5)(13)	8,297		—
Note due November 2017, (six-month LIBOR + 1.5%) 2.23% current Rate(3) (5) (6)	2,475		2,925
Note due September 2014, 5.5% fixed rate(1) (5) (6)	5,667		6,467
Note due August 2018, (1 year LIBOR + 2.75%) 3.79% current rate(3) (5)	5,400		6,300
Note due February 2016, 6.71% fixed rate(1) (5) (6)	6,175		7,125
Note due August 2014, 5.5% fixed rate(1) (5) (6)	7,000		8,000
Note due January 2015, 5.5%  fixed rate (1) (5) (6)	4,450		5,050
Note due March 2015, (Variable interest, to be reviewed annually)10.25% current rate(2)(5)	2,986		4,311
Note due August 2015, (Yr-1 5.0% Fixed rate, Yrs 2-3 5.5% Fixed rate and Yrs 4-5 Prime rate + 2.5%) 5.5% current rate(1) (5)	4,000		4,500
Note due November 2015 (4)(5)(6)	8,391		8,000
Note due April 2016 (5)(6)(8)(9)	7,723		7,924
Note due April 2016 (5)(6)(8)(10)	2,077		2,000
Note due April 2016 (5)(6)(8)(10)	6,230		—
Note due February 2017 (5)(6)(8)(11)	7,788		—
Note due September 2011, ($475,000 three year, zero interest, discounted loan) (7)	—		473
Total long-term debt	78,659		68,222
Less: current portion	7,237		7,771
Long-term debt, net of current portion	$	71,422	$	60,451

(1) Loan contains a balloon payment for net principal due at the end of the loan term.

(2) As collateral for this loan, the Company’s Honduras subsidiary entered into an agreement with Banco Del Pais to open and maintain a certificate of deposit with an initial interest rate of 3.88%.  The certificate of deposit is for $4.9 million as of August 31, 2012.  The certificate of deposit is automatically renewable by Banco Del Pais on an annual basis for the net amortized outstanding balance on the loan.

(3) The Company has entered into an interest rate swap agreement to eliminate the changes (variability) of the interest payments on these loans.  (See Note 13 – Derivative Instruments and Hedging Activities)

(4) On November 1, 2010, the Company’s Colombia subsidiary entered into a loan agreement with Citibank, N.A. in New York.  The agreement establishes a credit facility for $16.0 million to be disbursed in two tranches of $8.0 million each.  The interest rate is set at the 6 month LIBOR rate plus 2.4%.  The loan term is five years with interest only payments and a balloon payment at maturity.  The credit facility is renewable for an additional five-year period at PriceSmart Colombia's option.  As collateral for this credit facility, the Company entered into an agreement with Citibank, N.A. to open and maintain a certificate of deposit equal to the amount outstanding on the loan with an initial interest rate of 6 month LIBOR plus 1.66%. The Company’s Colombia subsidiary entered into a cross-currency interest rate swap agreement on November 17, 2011 with the Bank of Nova Scotia (“Scotia Bank”).  Under the cross-currency interest rate swap agreement, the Company will receive variable interest in U.S. dollars based on the 6-month LIBOR rate plus 2.4% (Interest rate is 3.12% as of August 31, 2012) on a notional amount of US$8.0 million and pay fixed Colombian peso (“COP”) interest of 5.85% on a notional of COP 15,360,000,000 (US$8.4 million as of August 31, 2012) for a term of approximately two years. (See Note 13 – Derivative Instruments and Hedging Activities)

(5) The carrying amount of the non-cash assets assigned as collateral for long-term debt was $59.6 million and $70.9 million as of August 31, 2012 and August 31, 2011, respectively. The carrying amount of the cash assets assigned as collateral for long-term debt was $35.0 million and $22.2 million as of August 31, 2012 and August 31, 2011, respectively.

(6) As of August 31, 2012 and August 31, 2011, the Company had approximately $58.0 million and $47.5 million, respectively, of long-term loans in Trinidad, Barbados, Panama, El Salvador, Honduras and Colombia that require these subsidiaries to comply with certain annual or quarterly financial covenants, which include debt service and leverage ratios. As of August 31, 2012 and August 31, 2011, the Company was in compliance with respect to these covenants.

(7) As of August 31, 2011, approximately $473,000 of the Company’s long-term debt, current portion was collateralized by shares that the Company owns in the joint venture, Newco2.  (See Note 16 – Unconsolidated Affiliates.)  On September 29, 2011, the Company exercised its option to cancel its participation in this joint venture, and the Company was released from the long-term debt.

(8) On March 14, 2011, the Company’s Colombia subsidiary entered into a loan agreement with Scotiabank & Trust (Cayman) Ltd.  The agreement establishes a credit facility for $16.0 million to be disbursed in several tranches.  The interest rate is set at the three-month LIBOR rate plus 0.7%.  The loan term is five years with interest only payments and a balloon payment at maturity.  This loan is secured by a time deposit of $16.0 million pledged by the Company’s Costa Rican subsidiary.  The deposit will earn an interest rate of three-month LIBOR.  The first tranche of $8.0 million was funded on April 1, 2011, and the Company secured this portion of the loan with an $8.0 million secured time deposit.  The second tranche of $2.0 million was funded on July 28, 2011, and the Company secured this portion of the loan with a $2.0 million secured time deposit.  The Company drew down the third and final tranche of $6.0 million on September 30, 2011, and the Company secured this portion of the loan with a $6.0 million secured time deposit.  On January 31, 2012 the Company’s Colombia subsidiary and Scotiabank & Trust (Cayman) Ltd., amended and restated the March 14, 2011 loan agreement.  The amendment increased the credit facility by $16.0 million; as a result, the total credit facility with Scotiabank & Trust (Cayman) Ltd. is for $32.0 million.  The interest rate on the incremental amount of the facility as the tranches are drawn is three-month LIBOR rate plus 0.6%.  The loan term continues to be five years with interest only payments and a balloon payment at maturity.  The deposit will earn an interest rate of three-month LIBOR.  An additional tranche of $8.0 million was funded on February 21, 2012, and the Company secured this portion of the loan with an $8.0 million secured time deposit.

(9) The Company’s Colombia subsidiary entered into a cross-currency interest rate swap agreement on May 5, 2011 with the Bank of Nova Scotia (“Scotia Bank”).  Under the cross-currency interest rate swap agreement, the Company will receive variable interest in U.S. dollars based on the three-month LIBOR rate plus 0.7% (Interest rate is 1.16% as of August 31, 2012) on a notional amount of US$8.0 million and pay fixed Colombian peso (“COP”) interest of 6.09% on a notional of COP 14,136,000,000 (US$7.7 million as of August 31, 2012) for a term of approximately five years.  The first LIBOR reset dates for the hedged long-term debt and the cross-currency interest rate swap occur on the first day of January, April, July, and October, beginning on July 5, 2011. The quarterly interest due to or due from Scotia Bank on the derivative instrument will be settled on a net basis. That is, if the floating leg is greater than the fixed leg on the swap, then the Company will receive a single, net amount from Scotia Bank.  Conversely, if the fixed leg is greater than the floating leg, the Company will pay a single net amount to Scotia Bank. (See Note 13 – Derivative Instruments and Hedging Activities)

(10) The Company’s Colombia subsidiary has subsequently entered into cross-currency interest rate swap agreements dated October 21, 2011 with the Bank of Nova Scotia with respect to notional amounts of US$2.0 million and US$6.0 million, respectively. On the first of these additional swaps, the Company will receive variable US$ interest based on the three-month LIBOR rate plus 0.7% (Interest rate is 1.14% as of August 31, 2012) on a notional of US$2.0 million and pay fixed COP interest of 5.30% on a notional of COP 3,801,600,000 (US$2.1 million as of August 31, 2012) for a term of approximately five years.  On the second of these swaps, the Company will receive variable US$ interest based on the three-month LIBOR rate plus 0.7% (Interest rate is 1.16% as of August 31, 2012) on a notional of US$6.0 million and pay fixed COP interest of 5.45% on a notional of COP 11,404,800,000 (US$6.2 million as of August 31, 2012) for a term of approximately five years. (See Note 13 – Derivative Instruments and Hedging Activities)

(11) The Company’s Colombia subsidiary entered into cross-currency interest rate swap agreements dated February 21, 2012 with the Bank of Nova Scotia with respect to notional amounts of US$8.0 million. The Company will receive variable U.S dollar interest based on the three-month LIBOR rate plus 0.6% (Interest rate is 1.03% as of August 31, 2012) on a notional of US$8.0 million and pay fixed COP interest of 6.02% on a notional of COP 14,256,000,000 (US$7.8 million as of August 31, 2012) for a term of approximately five years. (See Note 13 – Derivative Instruments and Hedging Activities)

(12) On January 13, 2012 the Company's Guatemala subsidiary paid off its local currency loan to Banco Industrial, S.A., for approximately $5.2 million.

(13) On December 22, 2011, the Company’s Guatemala subsidiary entered into a loan agreement based in Quetzales with Banco Industrial, S.A. for the equivalent amount of $8.9 million to be paid over ten years.  The loan has a variable interest rate, which will be fixed for the first three years to an interest rate of 8% per year.  Thereafter, the interest rate will be negotiable according to market conditions.

Annual maturities of long-term debt

Annual maturities of long-term debt are as follows (in thousands):

Years Ended August 31,	Amount
2013	$	7,237
2014	20,628
2015	14,172
2016	21,586
2017	10,019
Thereafter	5,017
Total	$	78,659